New Bankruptcy Opinion: FOUR IN ONE COMPANY, INC. v. SK FOODS, LP – Dist. Court, ED California, 2016





FOUR IN ONE COMPANY, INC., on behalf of itself and all others similarly situated, Plaintiffs,

v.

SK FOODS, L.P., INGOMAR PACKING COMPANY, LOS GATOS TOMATO PRODUCTS, SCOTT SALYER, STUART WOOLF and GREG PRUETT, Defendants.

Case No. 08-cv-3017 KJM EFB.

United States District Court, E.D. California, Sacramento Division.

May 10, 2016.

STIPULATION AND [PROPOSED] ORDER TO CONTINUE STATUS CONFERENCE

KIMBERLY J. MUELLER, District Judge.

WHEREAS, on September 16, 2014, the United States Bankruptcy Court for the Eastern District of California entered an order confirming the “Second Amended Joint Plan of Liquidation of SK Foods, LP and its Substantively Consolidated Affiliates (July 16, 2014)” [Dkt. No. 4980] (the “SK Foods Bankruptcy Plan”) in the Chapter 11 bankruptcy action filed by Defendant SK Foods, L.P. (Case No. 09-29162-D-11); and

WHEREAS, all funds from the Class settlements with Ingomar Packing Company, Los Gatos Tomato Products, Stuart Wolf and Greg Pruett have been paid and distributed to the Class and the only funds left to be distributed to the Class are those pursuant to the SK Foods Bankruptcy Plan in the bankruptcy action; and

WHEREAS, the SK Foods Bankruptcy Plan became effective in early 2015 and the Chapter 11 Trustee informed Class Counsel he anticipated making two or more distributions to creditors with the initial distribution to the Class to occur in April 2015, and additional distributions to the Class expected to occur in the near future pursuant to an application in the bankruptcy action for the release of additional funds being held by the Australian government; and

WHEREAS, Class Counsel received funds for the Class from the bankruptcy in the amount of $425,532.72, which by order of this Court were distributed pro rata to the Class members by the claims administrator under the approved plan of allocation; and

WHEREAS, on September 15, 2015, the Chapter 11 Trustee informed Class Counsel that the Attorney-General’s Department of the Australian Government (the “AGD”) has refused to release the requested additional funds finding such release inconsistent with the policy objectives of Australia’s Proceeds of Crimes Act of 2002; and

WHEREAS, the Chapter 11 Trustee has decided not to challenge the AGD’s decision under Australia’s administrative procedures act; and

WHEREAS, in light of the failure of the bankruptcy application to secure release of the Australian funds, the Chapter 11 Trustee has asked the United States Department of Justice (“DOJ”) to make a direct request to the Australian government for release of the funds; and

WHEREAS, Class Counsel does not yet know when or if the DOJ will agree to make such a request, or whether the Australian government in its discretion would choose to grant the request if made; and

WHEREAS, it is the opinion of Chapter 11 Trustee that if the DOJ were to make a direct request it would likely will take at least a year for the Australian government to decide whether to release all or a portion of the funds, based upon the Trustee’s experience with the Australian Minister of Justice’s decision-making process; and

WHEREAS, the Chapter 11 Trustee has informed Class Counsel that there may be monetary recovery obtained through adversary proceedings against the law firm of Kasowitz, Benson, Torres & Friedman LLP, and Donald J. Putterman in the Bankruptcy Court for the Eastern District of California (Adversary Proceeding No. 14-02025-D), which could result in funds being distributed to unsecured creditors, including the Class, but that any recovery is uncertain at this point and unlikely to occur sooner than in twelve months as the litigation is in the discovery phase with a pre-trial conference set for April 13, 2017; and

WHEREAS, the Chapter 11 Trustee anticipates making no future distribution to the Class other than the potential distributions referenced above; and

WHEREAS, the Court has a status conference currently scheduled for May 12, 2016;

NOW THEREFORE, the parties hereby stipulate, subject to this Court’s approval, that the May 12, 2016 status conference be continued for one year until May 11, 2017, or any other date convenient for the Court, to address status of the potential distributions from the bankruptcy proceedings.

Dated: May 9, 2016 By: /s/Arthur N. Bailey, Jr.
Michael P. Lehmann
Arthur N. Bailey, Jr.
HAUSFELD LLP
600 Montgomer Street, Suite 3200
San Francisco, CA 94111
Telephone: (415) 633-1908
Facsimile: (415) XXX-XXXXX
[email protected]
[email protected]

ORDER

As provided by the parties’ stipulation (ECF No. 267) and good cause appearing, the May 12, 2016 status conference shall be continued for one year until May 11, 2017 to address the status then of the potential distributions from the bankruptcy proceedings.

IT IS SO ORDERED.

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